Alberta's new government should be cautious about accelerating the decline of coal-fired electricity generation because it will have a damaging effect on employment, the head of the province's biggest investor-owned utility says.
Dawn Farrell, the chief executive officer of TransAlta Corp., told an energy conference in Toronto Tuesday that her firm and other coal-fired power producers are already on track to cut coal production and it is important that the new NDP government fully understands the implications before speeding things up.
"In Alberta, the coal transition is under way," Ms. Farrell said in a speech to the National Energy Roundtable. "By 2030, more than half of the province's coal fleet will either be retired or replaced with coal that has carbon capture and storage associated with it."
That transition will have a smaller impact on electricity prices in Alberta than it did in Ontario, where prices rose significantly during its phase-out of coal, Ms. Farrell said. But it will have a greater impact on employment because Alberta's coal-fired electricity generation has a lot of spin-off jobs. And "gas plants and wind farms typically do not generate very many jobs," she said.
Before she became Premier, NDP Leader Rachel Notley called for the phase-out of coal-powered electricity to be accelerated. Coal plants currently meet about half of the province's electricity demand but contribute significantly to its greenhouse-gas emissions.
In an interview after her conference speech, Ms. Farrell said that, once Ms. Notley understands that the decline in coal is already under way, she may temper her views. "I think once she gets all the information she might have a different view."
She also said the message hasn't sunk in with the public. "Albertans aren't that informed about what is already going on. People don't really understand that we are already on that path."
Federal rules just coming into effect will require that coal-based power generation be phased out across Canada eventually, but they allow existing plants to complete a 50-year lifespan.
Ms. Farrell has not yet met with the new Premier to discuss coal and other energy issues, but she expects that to happen soon. "Her Energy Minister came out and said that they are trying to get a global climate change plan by the end of June," Ms. Farrell said. "I run a big company. … I am sure we will be in discussions. I'm sure we will be on the list."
She said that, while 40 per cent of TransAlta's earnings come from coal-fired plants in Alberta and the western United States, the company also generates power from natural gas and is active in renewable energy production.
She said her company's polling shows that people have a pragmatic approach to energy production, environmental issues and prosperity. A majority of Canadians "expect business people, decision-makers and government to be able to figure out how to balance the environment and the economy."
Essentially, people are willing to make a transition to a cleaner economy, she said, but they want it to happen slowly so that they don't get hit with significant job losses, higher power prices or higher taxes.
Other conference participants were insistent that fossil fuels will play a key role in the Canadian economy for the foreseeable future, even while the transition to cleaner energy is under way.
François Poirier, president of the Energy East pipeline for TransCanada Corp., said his company's east-west pipeline project is crucial to getting western oil to Eastern Canadian refineries, where it can supplant imported crude. People opposed to Energy East should be aware that the oil will be extracted and shipped whether the pipeline is constructed or not, he said, and it is a much cleaner and safer option than shipping by rail or truck.
Ross Bayus, president of oil refiner Valero Energy Inc., told the conference that "oil products are always going to have a place in our marketplace" and they are "an important part of our lives and they actually make our lives better."